This newsletter is a compilation of news and information regarding the rental markets in Boulder and Broomfield counties and the economic status of and outlook for the area. It is issued during the first week of the month. The sources for the data include local and regional news media, association publications and seminars, and information gathered from contacts in the property management and real estate fields. We make every effort to cite all of our sources. Should we miss one please let us know so that we can correct the omission.

National Economic News

The Labor Department reported that job growth slowed in May, registering the smallest gain in nearly two years of only 78,000 positions. Experts attributed the figures to high energy prices and companies reducing excess goods. (The Rocky Mountain News, June 4, 2005).

The U.S. dollar strengthened overseas, following the defeat of the European Union constitution in France and The Netherlands. (The Rocky Mountain News, June 4, 2005).

Consumer prices fell in May with their first decline in 10 months. The Federal Reserved issued a survey of business conditions that described the economy as expanding at a healthy pace in recent weeks. (The Denver Post, June 16, 2005).

Housing starts rose in May by 0.2 percent. Construction projects continued at a strong pace to meet demand fueled by low mortgage rates. (The Denver Post, June 17, 2005).

Yields from U.S. money-market mutual funds reached their highest point in nearly four years in June. (The Denver Post, June 23, 2005).

The Commerce Department announced that nationwide sales of new single-family homes rose by 2.1 percent in May. (The Rocky Mountain News, June 25, 2005).

Oil prices reached record highs in June, topping $60 per barrel. (The Denver Post, June 28, 2005).

Despite high oil prices, consumer confidence rose to a higher than expected level for the second month in a row in June. It is at a 3 year high. (The Denver Post, June 29, 2005).

At the end of June, the Federal Reserve Bank raised interest rates for the 9th time in a year, indicating that the U.S. economy is on track despite rising energy prices. (The Denver Post, July 1, 2005).

Regional Economic News

The Denver Metro area added 8,100 jobs in April, which was a 0.6 percent increase over March and a 2.2 percent increase compared with 2004. (The Denver Post, June. 15, 2005).

The median home price for single family homes in the Denver metro rose above $250,000 in June. Multi-family housing also hit record highs. The median price of a single family home sold in June is projected at $251,500 which is 3.5 percent higher than a year ago. The median price of a condo is $163,307 as compared to $155,000 last year. (The Denver Post, June 22, 2005).

Denver area foreclosures are on pace to top those over last year when there were 12,393. That was the highest since 1988. (The Denver Post, June 28, 2005).

According to a new report by the FDIC, rising home prices have much outpaced income increases in Colorado over the last ten years. (The Denver Post, June 29, 2005).

Unemployment rates in Denver and Boulder reached their lowest levels since the 2001 terrorist attacks. Statewide, Colorado's unemployment for May was 5.3 percent. (The Denver Post, June 30, 2005).

Office rents in downtown Denver's highest profile buildings are the 5th cheapest in the nation. The vacancy rate among such buildings is at 16.4 percent and the average total rent is $27.21 per square foot. (The Denver Post, June 24, 2005.

According to the the Daily Camera (July 10, 2005; Business section) the commercial vacancy rates remain high across the Metro Area. Below are some of the local commercial vacancy rates....

The rental market is hot right now. As you can see from the chart, we are seeing the number of advertised rentals back down where they were this time in 2002. They are about 2/3 of what they were the last couple of years. We have seen this trend for some time. We are also seeing rents up very slightly for most, I repeat, most properties. While there increases are small, it is the first time in years we are seeing increases.

The City rental market continues to be intresting. We, and most of our competitors, are seeing a very slow student market. A higher percentage of the students are waiting to sign leases until just before school begins. This gives them options and much lower rents. Couple this with high student property vacancy rates and you can see the trend.

The City of Boulder is getting ready to release new on-line options for their information. One of these options will give people the option of filing complaints on properties over the web. While this is good news for the neighbors it could mean a much higher rate of problems for owners and landlords. I doubt the City has the staff to investigate each complaint and may just issue citations. We will have to see how this affects us.

What is a competitive rent for your property? There is no one answer for everyone. We will be working with each of our clients to determine how their property should be priced in this market. Please contact us if you have specific questions or want more information.

We are actively working to grow the business and to add new properties to our management inventory. If you know someone that would be interested in our services please send them our way. We pay referral fees to anyone referring us business!

That wraps things up for this month. Again, if you do not want to receive these messages please call or email us and we will take you off this mailing list.